 |
 |
 |
||
 |
|
|
||
|
||||
 |
|||||
|
10/20/2005 Ethanol 101 By Alan Lasee Ethanol has become a hot topic in the media recently and a lot of misinformation is being spread. The overreaction by the media has been spurred on by Assembly Bill 15. This bill would require all gasoline in the state to be blended with ten percent ethanol. The bill was amended to exempt gas over 87 octane from the ethanol mandate, sets up a waiver program that states gas stations can still sell gas if there is an ethanol shortage and sets up testing requirements for ethanol quality at the plants. I hope to set the record straight that ethanol is a welcome choice for citizens and taxpayers statewide. As the price of gasoline continues to skyrocket, we need to examine the use of alternative fuels and other means to ease our burden every time we fill up our tanks. One of the main reasons I support Assembly Bill 15 is my belief that we need to reduce our dependence on Middle Eastern oil and break the stranglehold of foreign oil sheiks. To me, it is a no-brainer that ethanol, which can be produced in state by the corn grown by our farmers, is a good start to reducing our dependence on foreign oil. Ethanol is an alternative fuel that is currently sold in the form of E-10 which is ten percent ethanol and 90 percent gasoline. Many automobiles can run on E-85 which is 85 percent ethanol and fifteen percent gasoline. These vehicles are called flex fuel vehicles, and they can burn either ethanol or gasoline. When the petroleum market is in flux, the consumer can choose to purchase ethanol. On the contrary, when corn production is weak, the consumer can purchase gasoline. Certainly the basic tenants of the free market and supply and demand will provide options to consumers. There is no doubt that ethanol production would have a tremendous impact on Wisconsin taxpayers. While our taxpayers are paying farms not to plant corn, our neighboring states of Iowa and Minnesota are encouraging their farmers to plant corn and produce ethanol. In those states, it is not unusual to see ethanol selling from five to 75 cents cheaper per gallon! A cost savings like this makes a difference on the family budget. While taxpayers would see the benefit from ethanol at the pumps, our economy would see a positive impact as well. Ethanol production creates thousands of high paying jobs, increases tax collections and farm income. It is estimated that 370 local jobs are created during the construction of the ethanol plant and many local jobs are created during the plant operation. Constructing one new ethanol plant alone could bring in as much as $230 million in new revenue. This revenue could then be dispersed into the state economy instead of lining the pockets of the foreign oil sheiks. Not only do taxpayers and the economy see a boost, but ethanol also has a significant environmental impact. Ethanol is the only gas component that reduces green house gases along with reducing the known carcinogen benzene, which is the primary compound found in gasoline. Ethanol also decreases carbon monoxide in the air we breathe. A major misconception is that ethanol is not good for your automobile, but I have not found a convincing study to prove that. Each and every auto manufacturer selling vehicles in the United States provides a warranty for every make and model that uses an ethanol blend. What ethanol opponents fail to realize is that most boat, personal watercraft, snowmobile, lawn mower and small engines provide a warranty for use with ethanol. In fact, the Indianapolis car racing series has agreed to use 100 percent ethanol in their race cars by 2007. If a high performance racing car can use ethanol, I believe it should be fine for the average family automobile. The bottom line is our farmers have the capability of providing corn as a sustainable and renewable source for ethanol. Having ethanol produced in Wisconsin rather than continuing to rely on Middle Eastern countries makes good sense. Ethanol will help ease gas prices, create jobs to stimulate our state’s economy and is environmentally sound. While ethanol is not the only answer to America’s energy needs and gasoline crisis, it is a large part of the overall solution. Wisconsin has an opportunity to take advantage of the resources found in our backyard and to not seize this opportunity would be a mistake. Ethanol’s Impact on the Global Marketplace While there is major ethanol production taking place in our bordering states of Iowa and Minnesota, there are several countries worldwide that have been involved. Brazil has been producing ethanol for many years, and during the 1980s most Brazilian automobiles ran on pure ethanol. In fact, Brazil’s ethanol production yield per acre has risen from 242 to 593 gallons. Most large foreign countries have begun to produce ethanol. China has been aggressively producing ethanol, and there has been a ten percent increase in production annually. Australia, Indonesia, India, Japan, Korea, Philippines, Thailand, European countries and Canada have been producing and pursuing ethanol with most countries mandating ethanol by legislation. There is no reason why Wisconsin could not lead the United States to keep pace with the global economy. Several opponents are actively trying to kill the proposed ethanol bills, Assembly Bill 15 and Senate Bill 15. One argument is that the free market system should take its course without legislative involvement. They further argue that if ethanol is cheaper and better overall, then consumers will automatically choose to fill their tanks with ethanol instead of gasoline. I am a proponent of the free market, but there is a substantial disadvantage when large monopolies like the Middle Eastern countries with the big oil sheiks have a stranglehold over the world’s oil reserve. How in the world can any new fuel source even begin to compete in the global marketplace against the money and resources of the existing big oil companies? These Middle Eastern countries and oil companies can invest unlimited amounts of money and resources to squash any new fuel sources, such as ethanol, from breaking into the fuel market. There is a role for government to become involved to break the stranglehold and help our farmers become involved in ethanol production for the good of the global economy. As I see it, when ethanol plant construction increases, the cost of production should continue to decrease. Ethanol production has a direct impact on the amount of energy we import, as increased ethanol use leads to decreased importation of energy. The American Coalition on Ethanol reports that the combination of reduced farm program payments with increased tax revenues from jobs adds at least $1.30 to the United States Treasury for each gallon of ethanol purchased. It is estimated that bio-fuels like ethanol could save the United States from importing more than 7.9 million barrels of oil per day by the year 2050—more than three times as much as we currently import from the Persian Gulf. Several corporations who compete in the global marketplace warranty the use of ethanol. Wisconsin’s very own Mercury Marine, John Deere, and Briggs and Stratton are examples of corporations which warranty the use of ethanol. Other corporations include among others Honda, Suzuki, Yamaha, Polaris and Evinrude. These companies pride themselves with premier products, and they would not be offering such warranties without proven customer satisfaction. As the legislative debate continues on this issue and the critics become more vocal, there are a few things to keep in mind. Ethanol production has increased worldwide, and several countries are making an investment in the use and production of this alternative fuel. Wisconsin has the resources to compete in the global marketplace with expanded ethanol production, and it is a chance for our state to take a step forward. Growing our economy while helping to supply an energy source is just one of the many ways Wisconsin can contribute to the world’s needs. -- Lasee, a Republican, is state Senate president. |
|